premiums

Thanks, Obamacare: Customers may have to switch their health plans to avoid significant premium increases

Changes to health insurance plans many customers have purchased through the Obamacare exchanges will mean that they will have to switch plans to avoid significant premium increases in 2015.

According to an analysis released late last week by Avalere Health, the subsidies provided to consumers who purchase plans on the exchanges are tied to the second-lowest cost silver plan available. Any premium cost over the subsidy for the benchmark plan is the responsibility of the consumer.

“Most enrollees in 2014 chose a plan based on the monthly premium. However, the lowest cost plans in 2014 may no longer be low cost in 2015,” Avalere Health Director Elizabeth Carpenter explained in a release. “Before consumers renew their 2014 plan, they should consider the tradeoff between continuity of care and lower monthly premiums.”

Avalere Health found that the benchmark silver plan will lose that status in 2015 in six of the nine states it analyzed and the lowest-cost plan changed in seven of the nine states.

In Maryland, for example, a customer earning $17,500 received a $156 subsidy and paid $58 out of pocket for the benchmark plan in 2014. But that plan is now the ninth-lowest cost silver plan, meaning that the part of the premium for which they’re responsible will rise to $94 in 2015, a 62 percent increase. The subsidy will increase slightly to $173.

Americans to Obama: No, the Obamacare debate isn’t over

Obamacare may be off the frontpage, as yet another Obama administration scandal has dominated the headlines, but the law remains immensely unpopular with Americans, according to the latest Associated Press-GfK poll:

A new Associated Press-GfK poll finds that public opinion continues to run deeply negative on the Affordable Care Act, Obama’s signature effort to cover the uninsured. Forty-three percent oppose the law, compared with just 28 percent in support.
[…]
The poll does have a bright spot for the administration: Those who signed up for coverage aren’t reeling from sticker shock. Most said they found premiums in line with what they expected, or even lower.

But even that was diminished by another finding: More than one-third of those who said they or someone in their household tried to enroll, were ultimately unable to do so. For the White House, it’s an uncomfortable reminder of the technical problems that paralyzed the HealthCare.gov website for weeks after it went live last fall.

The numbers are roughly consistent with the past three Associated Press-GfK polls on the law dating back to December. Overall, more than 50 percent of Americans oppose Obamacare, according polling data compiled by Real Clear Politics, making President Obama’s declaration that the Obamacare “debate is and should be over” look laughably absurd.

Today in Liberty: Conservatives want Obamacare replacement vote, Bloomberg to spend $50 million on anti-gun group

“The legitimate powers of government extend to such acts only as are injurious to others. But it does me no injury for my neighbor to say there are twenty gods, or no god. It neither picks my pocket nor breaks my leg.” — Thomas Jefferson

— House conservatives press for Obamacare replacement vote: Republican leaders suggested earlier this year that they would bring to the floor an Obamacare replacement bill, only to back away not long after. House conservatives are now pressing leadership to live up to the rhetoric and hold a vote on an alternative before the August recess. “At the end of the day, we feel it’s really important to bring a bill to the floor that is a true replacement to the president’s healthcare law,” Rep. Steve Scalise (R-LA), chairman of the Republican Study Committee, told The Hill. “Look, leadership’s come a long way in the last six months on that, and we’re continuing to talk to them to try to get to a point where we actually have a vote on the House floor by the August recess.”

AR Senate: Mark Pryor says he’d vote for Obamacare again

Mark Pryor

Sen. Mark Pryor (D-AR) has doubled-down on his support for Obamacare. Even though the law has led to premium increases and caused millions to lose their health plans, the vulnerable Democrat told a local media outlet that he would vote for it all over again.

KARK’s Matt Mosler noted that 6 million people lost their health insurance coverage and that a small percentage of signups came from the uninsured. Pryor, however, disputed the numbers.

“I don’t know that I’d go with the 6 million figure that they’ve lost their health insurance,” Pryor said in video made available by America Rising. “I mean, again, some of these stats are very debatable.”

The 6 million figure may or may not overestimate the number of health plan cancellations. The Associated Press reported at the end of the year that this number came to around 4.7 million.

Jindal offers state-focused Obamacare alternative

Through his nonprofit group, America Next, Gov. Bobby Jindal (R-LA) has proposed The Freedom and Empowerment Plan, a comprehensive replacement for Obamacare that focuses state-level solutions to reduce healthcare costs.

“Repealing all of Obamacare is a good and necessary step — but not one sufficient by itself to achieve the real health reform America needs,” Jindal writes in the 26-page document outlining the plan. “The President was right about one thing: American health care did need reform. But Obamacare did not ‘reform’ American health care, so much as it took a dysfunctional system and made it dramatically worse.”

Some of the features of the plan are similar to other proposals. The Freedom and Empowerment Plan, for example, would reform the medical malpractice system. It would also make health insurance coverage more portable, expand access to health savings accounts (HSA), and allow Americans to purchase coverage across state lines.

The most notable part of the plan is that it would guarantee access to health insurance for Americans with preexisting conditions, pushing the idea of a “new $100 billion innovation pool.” In order to receive the funding for the high-risk pools, states will have to “guarantee access for individuals with pre-existing conditions.”

The Republican Study Committee pushed a similar approach to preexisting conditions. The American Health Care Reform act pledges $25 billion over 10 years to off-set costs as well as capping premiums at 200% of average premiums.

A third of Obamacare enrollees were previously uninsured

One of the measures of “success” for Obamacare will be the number of uninsured Americans who signed up for health plans on the state and federal exchanges.

Taking into account the disruption to the health insurance market because of the law and other ways the administration could have approached reform, there’s not one way to look at this question. But it’s still an important gauge, given that access to health coverage for the uninsured was one of the driving themes behind Obamacare.

Robert Laszewski, an insurance industry consultant, says it’s one of the two major questions on which we should judge the success of the law.

“Obamacare was enacted, and the private health insurance market fundamentally changed, so that we could cover millions of people who previously couldn’t get coverage,” he noted. “To what extent have we reduced the ranks of the uninsured––how many of these people who enrolled were previously insured and how many of them were previously uninsured?”

The White House still doesn’t know how many people who were previously uninsured signed up for health plans. White House Press Secretary Jay Carney told reporters on Monday that the administration ” expect[s] there to be a good mix of people who were previously uninsured who now have insurance,” adding that this is a hard figure to measure.

Enrollment extension could cause headaches for insurers

The Obama administration’s extension of the Obamacare open enrollment period past the original March 31 deadline could be a headache for insurance companies participating on the exchanges. Insurers are supposed to begin submitting their rates for 2015 in a couple of months, and the extended enrollment period is adding to the uncertainty created by the law:

Insurers fear that past-deadline enrollees could complicate efforts to calculate premiums for next year, which will be filed with regulators from this spring. Health plans want to know who has signed up this year and their medical needs, so they can gauge what to charge in 2015.

“The more information that’s coming in that we can’t use for our [rate] filing because of the time frame, the less accurate and predictive we will be,” said Patrick Getzen, chief actuary at Blue Cross & Blue Shield of North Carolina.

Insurers have also pushed for enrollment periods to be tightly restricted, to avoid the prospect of healthy people waiting until they have an accident or illness to obtain coverage now that health plans can no longer bar people based on their medical condition. “The special enrollment period needs to be limited to a clear period of time,” said Robert Zirkelbach, a spokesman for America’s Health Insurance Plans, an industry trade group.

Cancer patient struggles to pay for Obamacare plan

 Tony Angran

An Iowa pastor and Stage 3 cancer patient has determined that Obamacare isn’t unaffordable. He and his family are trying to figure out how to cover the cost of an $850 monthly premium for health plan they purchased, and they’re asking those who hear their story for prayers:

Pastor Tony Angran of Centerville was diagnosed with cancer of the esophagus in January. He had insurance, but it did not cover certain things, like chemo. Since then, he has racked up $50,000 in medical bills and emptied his savings account.

So Angran signed up for insurance through the Affordable Care Act exchange. But with premiums of $850 per month, Angran says it isn’t affordable either, and he can’t get the treatment he needs until he has the right insurance. “I’m struggling here with stage three cancer and they’re sending me to the financial person to find out how are you going to pay for this?” Angran says.

Under the terms of the Affordable Care Act, Pastor Angran also has to wait two weeks before the coverage will kick in, so he has to put off his cancer treatments until then.

Unlike other horror stories we’ve heard, this one is unique because it shows the problems of the pre-Obamacare system and very real concerns being expressed by many families about the cost of these plans. It’s not your average Obamacare horror story, but it’s a horror story, nonetheless.

Insurers: Obamacare premiums will skyrocket

Health and Human Service Secretary Kathleen Sebelius tried to downplay the expected rise in health insurance premiums last week, telling a House committee that premiums would ”go up at a smaller pace than what we’ve seen since 2010.”

Those comments are already questionable. Obamacare caused the average individual health plan premium to increase by 39% between 2013 and 2014 and the average family plan to increase by 56%, according to data provided last month by eHealthInsurance.com.

These increases surpass the average of the previous eight years combined, a consequence of the law’s actuarial requirements, taxes and fees, as well as the mandated essential benefits.

For their part, insurers are disputing Sebelius’ claim, The Hill reports. They’re expecting premiums to rise sharply in some areas of the country, perhaps double or triple, which is partially blamed on the botched rollout of the federal Obamacare exchange:

Health industry officials say ObamaCare-related premiums will double in some parts of the country, countering claims recently made by the administration.
[…]
“It’s pretty shortsighted because I think everybody knows that the way the exchange has rolled out … is going to lead to higher costs,” said one senior insurance executive who requested anonymity.

Obamacare premium increases eclipse previous eight years combined

During testimony last week before the House Ways and Means Committee, Health and Human Services Secretary Kathleen Sebelius conceded that health insurance premiums would go up for plans in 2015, though she downplayed the increase by claiming that they would “go up at a smaller pace than what we’ve seen since 2010.”

There are varying estimates about how much premiums have gone up over the last several years, but everyone tends to agree that the increased costs are a concern. In fact, President Barack Obama has cited premium increases as part of the larger case for healthcare reform, promising that Obamacare would reduce premiums by $2,500 per year.

But, to Sebelius’ point, let’s take a look a premium increases, not just since 2010, but going back to 2005 through data provided by eHealthInsurance.com. As you can see in the chart below, the average individual health insurance premium rose by 37% from 2005 to 2013 and by 31% for the average family premium. Keep in mind that these are pre-Obamacare premiums.

 Average Individual and Family Premiums and Deductibles (With Year-over-Year Change) 2005-2013

Here’s the kicker, folks. eHealth, the nation’s first and largest private exchange, has also released data comparing average February 2013 premiums to unsubsidized plans that were being purchased in February 2014.


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